Analyzing Provident Financial (NASDAQ:PROV) and Northpointe Bancshares (NYSE:NPB)

Provident Financial (NASDAQ:PROV) and Northpointe Bancshares (NYSE:NPB) are both small-cap finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their dividends, earnings, valuation, risk, profitability, institutional ownership and analyst recommendations.

Institutional & Insider Ownership

71.3% of Provident Financial shares are held by institutional investors. 11.4% of Provident Financial shares are held by insiders. Comparatively, 18.4% of Northpointe Bancshares shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Profitability

This table compares Provident Financial and Northpointe Bancshares’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Provident Financial	10.40%	4.85%	0.50%
Northpointe Bancshares	N/A	N/A	N/A

Analyst Recommendations

This is a breakdown of recent recommendations and price targets for Provident Financial and Northpointe Bancshares, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Provident Financial	0	1	0	0	2.00
Northpointe Bancshares	0	0	2	0	3.00

Provident Financial presently has a consensus price target of $16.50, suggesting a potential upside of 7.28%. Northpointe Bancshares has a consensus price target of $17.75, suggesting a potential upside of 6.86%. Given Provident Financial’s higher probable upside, research analysts plainly believe Provident Financial is more favorable than Northpointe Bancshares.

Valuation & Earnings

This table compares Provident Financial and Northpointe Bancshares”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Provident Financial	$39.00 million	2.64	$6.26 million	$0.93	16.54
Northpointe Bancshares	$390.45 million	1.46	$55.16 million	N/A	N/A

Northpointe Bancshares has higher revenue and earnings than Provident Financial.

Dividends

Provident Financial pays an annual dividend of $0.56 per share and has a dividend yield of 3.6%. Northpointe Bancshares pays an annual dividend of $0.10 per share and has a dividend yield of 0.6%. Provident Financial pays out 60.2% of its earnings in the form of a dividend.

Summary

Provident Financial beats Northpointe Bancshares on 7 of the 13 factors compared between the two stocks.

About Provident Financial

Provident Financial Holdings, Inc. operates as the holding company for Provident Savings Bank, F.S.B. that provides community banking services to consumers and small to mid-sized businesses in the Inland Empire region of Southern California. The company's deposit products include checking, savings, and money market accounts, as well as time deposits; and loan portfolio consists of single-family, multi-family, commercial real estate, construction, mortgage, commercial business, and consumer loans. It also offers investment services comprising the sale of investment products, such as annuities and mutual funds; and trustee services for real estate transactions. The company operates through full-service banking offices in Riverside County and San Bernardino County. Provident Financial Holdings, Inc. was founded in 1956 and is headquartered in Riverside, California.

About Northpointe Bancshares

Northpointe Bancshares, Inc. operates as a bank holding company. It offers a nationwide mortgage purchase program, residential mortgage loans, digital deposit banking to retail customers and custodial deposit services. The company was founded by Charles A. Williams in 1998 and is headquartered in Grand Rapids, MI.